Article: Home Refinancing Rates - When Is It Worth It To Refi?
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Home Refinancing Rates - When Is It Worth It To Refi?
When interest rates were two points below your current mortgage rate, it was considered a good rule of thumb to refinance. But with today?s low closing costs, a difference of one percent can save you money on your interest costs. Even with low fees, it only worth it to refinance when you can be sure you can recoup the mortgage costs.
Figuring Up Costs
Refinancing is simply paying off one loan and taking a new one. The same fees that you paid with the first mortgage, you will probably have to pay for the second mortgage. Usually, loan cost range between $2000 to $6000 for a $200,000 loan. You will also have to add in points for lower interest rates, adding additional thousands. The only way to recoup these costs is to keep your mortgage for several years.
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